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GST on reimbursement of Expenses of distributor

Harish Haridas (Asst. Manager - Finance) (27 Points)

27 November 2019

Hi,

We are in FMCG industry( Manufacturing and trading) . We having our Superstikiest and Distributors acrross India. We have given vehice to distributors for delivering our goods to retail market. Now they will incure some expenses relted to the delivery ( Driver Salary , Fuel Charges , Vehicle Maitenance Expenses ect, a) and same will reimbuse from us. Can you please telll us the implication of GST on such reimbusement and also let us now the rate they should charges if GST is applicable.

Regards

HARISH

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2 Replies

Pankaj Rawat (GST Practitioner) (55037 Points)
Replied 27 November 2019

Where invoice for all those expenses Incurred by distributor is name of company & the same has been reimburse on actual then No GST Attracts , it cover under Defination of Pure Agent in term Section 2(5) of CGST Act .(Refer rule 33 also)

& where the Invoices for such expenses is not in company name & even though it's being reimbursed on actual, GST is applicable (As per Section 15 (2)(b) )